- The profitability of Unilever, New Zealand depends on the successful implementation of the sustainable business plan of the company in New Zealand. The company has witnessed a 46% higher sales of the products of the sustainable brands of the corporation.
- Since 2016, 70% of the profit earned has come from the sale of these products. The sustainability based product line ensures the productivity of the company by cutting costs also. This involves limited use of energy which has saved about 490 million NZ Dollar for them. Moreover, the popularity of the sustainable products of Unilever in New Zealand would strengthen the competitive position of the company in the country.
- The company intakes raw materials mostly from sustainable sources. For evidence the organisation fetches 80% of its agricultural raw materials from small holder farmers, who provide supplies at 18 to 25% lower cost.
- Besides, as per Kroftet al. (2016), the effect of economic change in future would be least on such suppliers. Hence the company would be able to maintain a risk-proof supply chain.
- The Sustainable business model also enhance the employee’s relations and ensures skill development of the employees. The employees’ receive special training to understand the needs of local sustainability, which might ensure the welfare of both the country as well as the organisation. Moreover, sustainably survey allows them to employ locals, thereby creating more employment opportunities.
- The sustainability model also is made more popular by the use of technological innovations. For evidence in New Zealand, the company uses a packaging technology that ensures least impact on the ecology and creates thoroughly biodegradable yet lucrative and attractive packaging.
- Lastly, by means of this sustainable business model, the organisation aims at creating value towards the society also (Unilever.com.au, 2018). The company has not only reduced about 5% of the environment footprint by using less energy and reusing resources, but also provided employment to the locals in high scale.
Question 2
- New Zealand Unilever had a rising graph of Shareholder return after the new CEO joined the company. However, the rate of return fluctuated and started to detoriate. Searching the flaws in the business strategy Demarco et al. (2015), concluded that the transition to a long term investment planning increased the market shares initially. However, not all the stakeholders were ready to invest more, (doubtful of leaving short term goal making), and walked out.
- This had a promo effect on the market share. However, the company have been returning shares to their shareholders that are not exponential but steady in rate. Hence, it is preferable that Unilever stick to their long term investment strategy. The Human Resource policy followed by Unilever is promising.
- However, they have not created value as the natural choice of employees. This is why, the company was left out of the list of top 50, and employees choose to work for. Hence in order to ensure employees satisfaction, the company must take few measures. They can remove the complimentary training for the employees, or raise the appraisal value for more skilled employees.
- The brand equity of the company is also not high in New Zealand. The network of food and personal and/or home care brands have consumed the brand loyalty.
- The brand value of parent brand always helps to occupy new markets with easier. The organisation should preach the brand name of Unilever with greater will.
Question 4
- Unilever has a concise and stable budgeting process for New Zealand. However, some new inclusions can help the new CEO to reap the advantages of management accounting. Firstly, the supposals of the budget, have to be aligned with the long term budget plans of the company.
- However, the new CEO have to ensure proper communication between the shareholders because the budgeting process for the long term goals is totally dependent on the factors like expense, assets, finance and other factors which requires an unified decision to be taken by all the shareholders and stakeholders. Besides, a new management accounting information process is also required.
- As per the ideas of Fayard (2015), this system can help the organisation to gather data from the external as well as the internal sources. This is crucial for avoiding situation like the negative voting of the VEB against Mr Burgmans, as evident from the case study. In this context, the new CEO also needs to incorporate a management reporting process.
- Local IT agencies of New Zealand have to be given the charge of management reporting so that fund analyses, variance analyses and statistical analyses of the supply chain and the variegated product line of the comp any can be done with transparency.
- Quinn (2014),states that in the context of management accounting, the costing process is also significant. The costing process of the company is very accurate and the new CEO should take advantage of the infrastructure.
Question 4
- Marketing is integral to the success of the company in the long run. In order to implement the sustainable business model, the company needs appropriate marketing.
- Product marketing should be done in such a way that the customers can connect to them. Innovative marketing techniques to reach out the customers have to be framed.
- The sustainable business policy of the company should be marketed through advertisements.
- The company can release a new series of advertisements that would discuss the efforts undertaken by the company like reducing waste producing and increasing recycling of reusable wastes along with reduction in the use of e Wastes.
- The audience, when they come to know of these endeavours would feel connected with the products as they would perceive that the products they are purchasing generate value towards the society.
Question 5
- Polman has been chosen by the directors for making revolutionary changes in the organisation. However, Unilever is a company with a standard, core business model. In the new business domain, the CEO have to formulate strategies that addresses the sustainability development goals of the UN.
- Employee allowances like health and wellbeing of the employees can be promoted through appraisal policies. The Fair Compensation policy of the company have to be run in New Zealand also.
- As such, Glendon, Clarke and McKenna (2016), opines that the local employees of New Zealand would come under the Lamplighter campaign and gain cash allowances for medical needs. Besides, the Vision Zero Strategy should also be implemented in New Zealand facility of the company (Unilever.com.au, 2018).
- Under the framework of the strategy, the employees of New Zealand Unilever would get insurance in cases of Fatalities, big injuries, process incidents or in case of intolerable behaviour or practice against them in the workplace.
Reference List
Demarco, F. F., Collares, K., Coelho-de-Souza, F. H., Correa, M. B., Cenci, M. S., Moraes, R. R., &Opdam, N. J. (2015). Anterior composite restorations: A systematic review on long-term survival and reasons for failure. Dental Materials, 31(10), 1214-1224.
Fayard, D. (2015). A Case For Using A Fixed-Cost Funding Model For State-Funded Higher Education Institutions: A Management Accounting Perspective. AAUA, 30(1), 27-33.
Glendon, A. I., Clarke, S., & McKenna, E. (2016). Human safety and risk management. Crc Press.
Kroft, K., Lange, F., Notowidigdo, M. J., & Katz, L. F. (2016). Long-term unemployment and the Great Recession: the role of composition, duration dependence, and nonparticipation. Journal of Labor Economics, 34(S1), S7-S54.
Quinn, M. (2014). Stability and change in management accounting over time—A century or so of evidence from Guinness. Management Accounting Research, 25(1), 76-92.
Unilever.com.au, (2018). Sustainable growth: Values + Values. Retrieved on 09 June 2018.
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